Microsoft did not announce an official date for an ARM version of Windows Server, though the software company is using such systems internally. The announcement was made on the opening day of Open Compute Project's U.S. Summit in Santa Clara, Calif.

At the summit, Qualcomm showed a new 48-core 1U server running its Centriq 2400 ARM chip. The server is based on Microsoft's Project Olympus server design and was shown running Windows Server. It was designed for the Azure cloud at Microsoft. The Centriq 2400 chip isn't available commercially but is still in testing.

Microsoft and Qualcomm will work together to develop new generations of Windows Server systems with Centriq 2400 chips. These non-x86 servers could be cheaper and give buyers considerable bargaining power, considering Intel's chips are expensive.

Cavium, working with server maker Inventec, also demonstrated Windows Server on a rack server with a motherboard housing the ThunderX2 ARMv8-A server chips. The Cavium server motherboard is designed to fit into servers based on Microsoft’s Project Olympus design.

The ARM server chips from Qualcomm and Cavium are highly customized with different levels of I/O, bandwidth, and protocol support. The Project Olympus server design will make it easy for companies to deploy a server that could use a variety of ARM or x86 chips, which until now, was considerably difficult.

ARM server processors haven't caught on despite drawing interest for more than five years as low-power chips. Most software is developed for Intel server chips, and the company now holds more than a 90 percent market share. Companies are also hesitant to invest millions to switch over from a stable x86 infrastructure to an unproven ARM architecture.

Project Olympus can switch easily from x86 to ARM processors, which tackles one problem of server investment and deployment. Microsoft has also tried to take on the software problem by fully porting a version of Windows Server to ARM.

"We have ported language runtime systems and middleware components, and we have ported and evaluated applications, often running these workloads side-by-side with production workloads," said Leendert van Doorn, a distinguished engineer for Microsoft in a blog post.

Other companies like Dell and Lenovo have similarly talked glowingly about ARM servers in the past, but failed to deliver stable systems. Most web servers run Linux, and ARM has failed to break into that market despite its chips working well with the LAMP (Linux, Apache, MySQL, and PHP) stack.

The issue with ARM chips on Linux servers has been the same as on Microsoft servers -- a lack of software and performance questions. Plus, Intel's Xeon server chips still remain among the fastest.

For its part, ARM is thrilled to have Microsoft as a partner in servers. It's a big break the company needs to expand into the server and infrastructure market, which is highly profitable. ARM already dominates in mobile, wearables, and internet-of-things devices, and the architecture will be returning to Windows laptops later this year via Qualcomm's Snapdragon 835 chips. The server market has eluded ARM so far, and it hasn't challenged Intel.

In a blog entry, ARM and Microsoft said both the companies combined will be "change-makers." But that's hard to see considering ARM chips and Microsoft's Windows Server are small players in the server market.

Intel said the server market is competitive, and it takes all products seriously.

"We are confident that Xeon processors will continue to deliver the highest performance and lowest total cost of ownership for our cloud customers. However, we understand the desire of our customers to evaluate other product offerings," Dan Francisco, an Intel spokesman, said in a statement.

Intel may seem calm, but internally, the company may be planning a way to counter the announcement by ARM and Microsoft. When the excitement around ARM server chips started spreading as early as 2011, Intel countered with low-power Atom chips for microservers, which doused the enthusiasm around ARM.

Outside of Qualcomm and Cavium, other ARM chip makers were also active at Open Compute Summit on Wednesday.

Macom showed off its X-Gene 3 chip for servers, storage, and networking devices. The chip was developed by AppliedMicro, which was bought by Macom earlier this year.

The X-Gene 3 has impressive features on paper. It has up to 32 cores, support for DDR4 memory, and 42 PCI-Express 3.0 lanes for fast throughput. It has 32MB of L3 cache shared across all cores and 256KB of cache for every two cores. The new chip will deliver more than five times the performance of an X-Gene 2, which has only eight cores. The X-Gene 3, however, draws more power than its predecessor.

The new Macom chip will start shipping to testers this month. The final shipment date for the chip wasn't announced.